Marketability is essential for excisability: unstable adhesive paste with short shelf life was not dutiable as such.

Adhesive paste or glue with a short shelf life and unstable composition was treated as not marketable in the form in which it emerged, because it lost adhesive properties within 24 hours and required re-mixing before use. The Chemical Examiner's report supported the view that the product could not be marketed as such, and the departmental challenge did not displace that finding. The settled excise principle applied was that manufacture and marketability are essential tests for excisability, so duty could not be fastened on the product in its existing state.

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Issues: Whether the adhesive paste or glue prepared by the assessee, having a short shelf life and being unstable in the form in which it emerged, was marketable and therefore excisable.

Analysis: The Chemical Examiner's report showed that the product lost adhesive properties within 24 hours, required re-mixing before use, was unstable, had a short shelf life, and was not marketable in that state. The departmental challenge did not dislodge the correctness of that report or show that the goods were capable of being marketed in the form in which they arose. In these circumstances, the settled legal position that manufacture and marketability are essential tests for excisability governed the matter.

Conclusion: The product was not excisable in the form in which it emerged, and the departmental appeals failed.

Final Conclusion: The impugned orders were sustained because the product lacked marketability in its existing state, so excise duty could not be fastened on it as such.

Ratio Decidendi: A product is not excisable unless it is the result of manufacture and is marketable in the form in which it emerges.

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